Fixed Income
The January ISM Services missed estimates, decreasing to 52.8 from 54.0 in December. The move was driven by activity components, while employment and suppliers’ delivery times increased. Additionally, the prices paid measure decreased, reversing the…
Our Portfolio Allocation Summary for January 2025.
While the US dollar has outperformed every single DM currency in the past few months, the only monetary asset it did not outperform is gold. The greenback is up between 5-10% against DM currencies since September of last year, but down by more than 8% vs.…
Trade tensions muddy the outlook for global central banks. The 2010s were an era of low growth and low inflation that called for easy monetary policy. The post-COVID era has been marked by overheating and high inflation calling for tight policy. The second…
Argentina is entering a regime shift from the traditional short boom-bust cycles of the past 50 years. Profound structural reforms will result in a productivity boom, leading to a more durable economic expansion while keeping with the disinflation trend. Authorities will likely lift capital and currency controls in the second quarter of this year. All in all, odds are that Argentinian assets have entered a multi-year bull market.
Our Chart Of The Week comes from Arthur Budaghyan, Chief Strategist of our Emerging Markets and China Investment Strategy services. Arthur highlights an important dichotomy in the US stock-bond yield correlation. In the past 12 months, US growth stocks…
Core PCE inflation came in soft this morning and is tracking well below the Fed’s 2025 forecast. We highlight three upside risks to inflation and preview next week’s employment report.
Our Global Fixed Income strategists assessed the risk of a second wave of inflation, and discussed the opportunities within the inflation-linked bond (ILB) market. Global disinflation remains on track, though energy prices and tariffs pose upside risks.…
The Federal Reserve kept rates on hold in its 4.25%-to-4.5% range, as expected. The main change in the statement was the removal of the reference to progress towards the Fed’s 2% target, leaving instead a simple mention that inflation “remains somewhat…
The Bank of Canada cut by 25 bps to 3% as expected, and announced the end of quantitative tightening. This sixth consecutive cut brings the policy rate further into neutral territory, estimated to be in the 2.25%-to-3.25% range. The BoC assessed…